MURALI KRISHNA INDUSTRY Vs. F C I

JUDGEMENT

(1.) The petitioner is seeking for a writ of Mandamus by declaring the letter No.PROC.9(8)/91-CM/KRMR dated 21-1-1993 of the respondent- Corporation as illegal and invalid.

(2.) In response to an advertisement, the petitioner submitted its tender for Milling of paddy stock offered by the respondent at Jammikunta Depot (Open Storage). According to the tender notice, paddy will be delivered "as is where is" basis and the petitioner should undertake to deliver the resultant Parboiled rice. As per the terms of the agreement the petitioner agreed to make good any shortfall in the rice at 1 times of the economic cost of the concerned variety. There is a clause which provides that the outturn ratio of conversion of paddy into Parboiled rice should be 71 per cent. Although it is indicated in the notification that the paddy is of the year 1991-92 procurement, in fact it was of the year 1990-91. As the petitioner has given bank guarantee, the respondent was threatening to encash the bank guarantee since the petitioner has failed to convert and supply 71 per cent of rice out of the paddy supplied from the open Godown as the paddy was exposed to Sun and rain by keeping it in open Godown. The terms of the contract are one sided and the bargaining power is not evenly balanced. Hence the writ petition for a direction not to enforce the terms of the contract.

(3.) Sri S. Venkat Reddy, the learned Senior Advocate appearing for the petitioner submits that although the petitioner is given the impression that the paddy was of the year 1991-92 procurement, but in fact it was of the year 1990-91. Further as the paddy was kept in open Godown subject to damage due to Cyclonic storm during the year 1990, the yield by way of resultant rice was very much affected. In fact in Sarangapur Rice Mill owned by the F.C.I, the same type of paddy was supplied to the said Rice Mill and the outturn was only 58 to 62 per cent for every 100 Kgs. of paddy supplied. When that is the factual situation, the respondent cannot insist the petitioner to supply 71 per cent of resultant rice.